InterimResults

Interim Results 2004

for the half year ended 30 June 2004

Allied Irish Banks, p.l.c.

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change.

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Forward looking statements

Michael Buckley

Group Chief Executive

Highlights

Adjusted earnings per share 10%

vs 60c base H1 2003* 7%

Profit before tax 10%

Dividend 10%

Tangible return on equity 28.6%

* excludes H1 2003 M&T / Allfirst integration costs of 1.5c

Strong fundamentals driving performance

Solid income growth, significant increases in loans & deposits

Tight cost management

Income growing faster than costs, improving productivity

Robust asset quality, positive trends

Solid income growth

28%

10%8%

9%7%

- 34 bps

Loans * Deposits* . Net InterestIncome

Other income Total OperatingIncome

* annualised volume growth

Includes income reduction of €36m re investigation

Net Interest Margin

-26

-8

Tight cost management

0%

4%

8%

12%

16%

20%

24%

28%

. .

Loans*

Deposits*

Costs

• Includes: - investigation costs of €9m- IAS & Basel II incremental costs €6m

* annualised growth

Moderate increase relative to strong business growth

Growing income faster than costs

Income 8%

Costs 5%

Positive gap 3%

57.7% 58.0% 56.0%50

52

54

56

58

60

Cost/income ratio

Improving productivity

4

6

8

10

H1 2003 2003 H1 2004

Cost growth Income growth

Robust asset quality

Dec 03 Jun 04

1.4 Non-performing loans (NPLs) % 1.3

6.7 Criticised loans / total loans % 6.3

0.9 Gross new NPLs % 0.7

94 Total provisions / NPLs % 91

31 Bad debt charge bps 20

General provision 2.6 times provision rate to June ‘04

1.3%1.4%1.8%2.0%

36bps37bps

31bps

20bps

0.0%

1.0%

2.0%

2001 2002 2003 H1 2004

0

5

10

15

20

25

30

35

40

NPLs Bad debt charge

Asset quality - benign trends

bps

Dynamic operating performance

AIB Bank Republic of Ireland 1%

(16% underlying)

AIB GB & NI 20%

Capital Markets 25%

Poland 163%

M&T 13%

Underlying* profit 16% Income 10%, costs 6.5%

Tangible cost / income ratio 54%, underlying* 50% (51% H1 2003)

Loans 14%, deposits 7% Ark Life profit €2m to €24

APE sales offset by tighter margins

Strong customer demand, continuing market share gains despite strong competition

AIB Bank Republic of Ireland 1%

* pre investigation charge

Year on year growth

23%28%

10%

29% 28%32%

13%19%

Total loans Business / otherpersonal lending

Mortgage lending Deposits

est. Market AIB ROI

AIB Bank Great Britain & Northern Ireland 20%

Growth underpinned by credit quality

Net provision writeback

20% 23%

17%

AIB Bank GB&NI

Great Britain

Northern Ireland

€148m €77m €71m

Income 12%, costs 10%

Tangible cost / income ratio 50% (51% H1 2003)

Sustained momentum in GB, distinctive “business & wealth management” focus

Loans 11%, deposits 16%

Customer focus driving strong N.I. performance

Loans 12%, deposits 7%

Capital Markets 25%

Income 6%, costs flat tangible cost / income ratio to 51% (55% H1 2003)

Realising benefits from 2003 restructuring programme

Corporate banking 58% loans 20%, strong international and domestic demand

excellent credit quality, lower provisions

Good Treasury performance driven by customer initiated activities

well positioned in global markets

continued low utilisation of risk limits for wholesale activities

Investment banking higher

Poland 163%

Combining business momentum with efficiency gains Income 10%, costs 10%

Tangible cost / income ratio 66% (81% H1 2003)

Loans 4%, deposits flat (investment funds 40%) good H2 pipeline

maintaining credit discipline

not competing for low margin corporate deposits

Positive asset quality trends

Profit recovery facilitated by improving economic environment

M&T 13%*

Net operating income 24%

Diluted net operating EPS 11%

Strong commercial loan growth and business pipeline

Good cost discipline, cost / income ratio 50.4% (53.6% Dec 2003)

Further reduction in NPLs, 0.51% (0.67% 2003)

Unchanged full year guidance

$5.90 - $6.10 GAAP EPS

* relative to Allfirst Q1 2003 and M&T contribution Q2 2003

0

3

6

9

12

15

Operations . . EPS

Operating / EPS growth

- 4%

Not anticipated to be material factors in 2005

Currency

Tax / Minorities / Shares13

7

%

- 2%

Gary Kennedy

Group Director, Finance & Enterprise Technology

Operating income(continuing activities)

919 Net interest income 977 7

7 Other finance income 9 16

557 Other income 585 9

1,483 Total operating income 1,571 8

38.0% Other income ratio 37.8%

H1 H1 Underlying

2003 €m 2004 change %*

Before investigation related charge of €36m: total operating income up 11% with other income up 16% banking fees & commissions up 13% (represents c.70% of other

income)

* excludes the impact of currency movements

Deposit growth*(continuing activities)

* excludes the impact of currency movements

** includes investment funds

-6%

12%

7%

5%

Poland

Capital Markets

AIB Bank GB&NI

AIB Bank ROI

Group

3% **

Risk weighted asset & loan growth*(continuing activities)

* excludes the impact of currency movements

10%

14%

13%

12%

13%

4%

18%

11%

14%

14%

Poland

Capital Markets

AIB Bank GB&NI

AIB Bank ROI

Group

RWA growth Loan growth

Loan growth analysis

Property & Construction

34%

House Mortgages

25%

Other41%

Loans 14%

3%

26%

8%9%

14% 14%

5%3%

9%

22%

5%

14%14%

7%

25%23%

Agriculture Construction &Property

ResidentialMortgages

Manufacturing Personal Services Transport &Distribution

Other

2003 H1 2004

Loan portfolios by sector - quality focus

% of Group loan portfolio

Excellent credit quality

NPLs 0.7% of portfolio

Well diversified portfolio by:

type (commercial, retail, office & residential),

geography

and borrower

Property & construction

Typical emphasis % of portfolios

investment strong covenants 58

development pre-sold / pre-let 36

contracting strong track records 6

100

House mortgages - Republic of Ireland

Primary focus on debt service ratio (repayment capacity)

New Business

Consistent LTVs (% no’s of drawdowns) Dec 01 Dec 02 Dec 03 Jun 04

< 75% 72 66 67 68

> 75% < 90% 22 26 25 23

> 90% 6 8 8 9

Total 100 100 100 100

Strong arrears profile (book balance €m) Dec 01 Dec 02 Dec 03 Jun 04

1 to < 2 payments in arrears 20 23 19 20

2 to < 3 payments in arrears 7 5 8 8

> 3 payments in arrears 26 30 27 29

Total 53 58 54 57

% total mortgage advances 0.9% 0.8% 0.5% 0.5%

Net interest margin

H1 H1 bps2004 2003 change

Continuing activities 2.46% 2.80% -34

Indicative breakdown of bps change

Funding effect of loans growing faster than deposits -15

Mix effects -4

Other -7

Sub total -26

Technical change in reinvestment of capital -8

Total -34

28% 28%

24% 24%

2003 H1 2004

Volumes Interest Income

RoI loan growth: volumes & interest income

* annualised

Broadly stable product margins

Operating expenses (continuing activities)

533 Staff costs 546 4

250 Other costs 273 11

88 Depr. & amort. 76 -11

871 Operating expenses 895 5

57.7% Tangible cost / income ratio 56.0%

* excludes the impact of currency movements

H1 H1 Underlying *

2003 €m 2004 change %

Non-performing loans by Division

209 0.8 109 AIB Bank ROI 215 0.7 108

84 0.8 148 AIB Bank GB & NI 105 0.9 120

82 0.8 149 Capital Markets 81 0.7 153

332 10.9 52 Poland - €m 340 10.5 521,560 - Pln m 1,538

707 1.4 94 Total 741 1.3 91

As at December 31, 2003 As at June 30, 2004NPLs/ Total NPLs/ TotalActual Provisions/ Actual Provisions/

NPLs Advances NPLs NPLs Advances NPLs €m % % €m % %

Bad debt provisions by division (continuing activities)

28 0.25 AIB Bank ROI 28 0.19

6 0.13 AIB Bank GB & NI (3) (0.05)

16 0.33 Capital Markets 10 0.17

16 1.00 Poland 20 1.32

- Group -

66 0.29 Total 55 0.20

H1 Average H1 Average 2003 Loans % €m 2004 Loans %

GB & NI - very strong recoveries / low levels of new provisions Poland - increased provisions in corporate portfolio. Overall trend continues

to improve. FY 2004 charge likely to be similar to 2003

Capital ratios

Total tier 1 capital €5,032m

Total capital €7,041m

Total risk weighted assets €72,146m

Tier 1 ratio 7.0%

Equity % of tier 1 86%

Total capital ratio 9.8%

H1 2004

Capital allocation

> 15% risk adjusted return a prerequisite

New lending exceeds targeted return rate

Strong capacity / various options to increase capital ratios

Pragmatic consideration of acquisition opportunities

Summary

Strong business momentum in all operating divisions

Improving productivity, clear income / cost gap

High loan growth and high quality credit portfolios

2004 adjusted EPS target: 123c - 126c (2003 base 118c)

Business dynamics underpin 2005 double digit EPS target

Additional Information

Tangible cost / income ratios* (continuing activities)

55%

57.7%

51% 51%

66%

56.0%54%**

51%50%

Group ROI GB&NI Cap Mkts Poland

H1 2003 H1 2004

* excludes goodwill ** investigation related charge of €45m included

81%

BZWBK consolidated Polish GAAP 303 64 89

BZ goodwill amortisation (12)

Other Group adjustments* (14)

Poland division 38 163

Jun 2004 Underlying

PLN €m change %

Poland Division relative to BZWBK

* includes central costs and other adjustments in line with AIB segmental reporting

Balance sheet (continuing activities)

31 Dec €m 30 June Underlying *2003 Assets: 2004 change %

50,999 Loans to customers 59,045 14

40,984 Customer accounts 43,773 5

80,960 Total assets 95,55016* excludes the impact of currency movements

Tier 1 7.1% 7.0%

Total 10.4% 9.8%

Dec 2003 Jun 2004

Risk weighted assets (continuing activities)

31 Dec H1 Underlying

2003 €m 2004 Change %*

24,119 AIB Bank Rep Ire 27,043 12

10,055 AIB Bank GB & NI 11,923 13

24,506 Capital Markets 28,695 14

3,259 Poland 3,689 10

62,615 Total RWA 72,146 13

* excludes the impact of currency movements

68.6 61.7 67.519.3 22.1 29.1 37.4 45.2 60.2 64.6

1.6%

1.1%

1.6%1.7%1.7%

1.8%2.0%

1.7%1.6%1.6%

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

1995 1996 1997 1998 1999 2000 2001 2002 2003 H12004

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

Average RWA (LHS) Return (RHS)

€bn

Return on risk weighted assets

* 2003 return on risk weighted assets, having absorbed loss on disposal of Govett, restructuring and early retirement costs and impact of Allfirst dividend withholding tax on Profit & Loss account

*

InterimResults

Interim Results 2004

for the half year ended 30 June 2004

Allied Irish Banks, p.l.c.

Alan Kelly alan.j.kelly@aib.ie +353-1-6412162

David O’Callaghan david.a.o’callaghan@aib.ie +353-1-6414191

Pat Clarke patricia.m.clarke@aib.ie +353-1-6412381

Mary Gethings mary.gethings@aib.ie +353-1-6413469

+353-1-660 0311

+353-1-641 2075

Our Group Investor Relations Department will be happy to

facilitate your requests for any further information

Visit our website www.aibgroup.com/investorrelations

Contacts